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S&P trims ECI Holdco view to negative
Standard & Poor’s said it revised its outlook on ECI Holdco Inc. to negative from stable and affirmed the B+ corporate credit rating on the company.
At the same time, S&P affirmed its B+ issue-level rating on ECI subsidiary Electrical Components International Inc.’s senior secured credit facilities, which include a $50 million revolving credit facility and the proposed upsized $350 million term loan. The recovery rating on this debt is 3, which indicates an expectation of meaningful (50%-70%; lower half of the range) recovery in the event of a payment default.
“The outlook revision reflects the potential that we may downgrade the company if its operating performance does not improve such that it sustains leverage of less than 5x and a funds from operations (FFO)-to-debt ratio of greater than 12%, or if the company pursues debt-financed acquisitions that prevent it from deleveraging,” said S&P credit analyst Svetlana Olsha in a news release.
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